Preaching to the choir: A response to Kaplow and Shavell's Fairness Versus Welfare

This note is a critical response to Louis Kaplow and Steven Shavell's recent treatise on law and economics, Fairness Versus Welfare, in which they argue that legal decision-making should be conducted with the sole goal of welfare-maximization. After a brief summary of the book, this paper focuses on three primary problems with its contents and approach. First, the tautological nature of the authors' argument, which they acknowledge but downplay is discussed. Second, it is argued that while the authors give lip-service to 'tastes for fairness,' they refuse to acknowledge the implications of such preferences for their conclusions and then minimize their possible importance. Finally, this paper addresses what is possibly the most disappointing aspect of this work: the arrogance, condescension, and intolerance displayed throughout the book toward those with dissenting views.     

武有新源,侠成善体——评《中国古典武侠小说史论》

宋巍博士的《中国古典武侠小说史论》是国内第一部系统论述先秦以来中国古代武侠小说的专著。该书突破以往文体、时代的局限,辑佚搜珍,完整地梳理了中国武侠小说的演变历程。在整理有关文学作品和历史文献基础上,此书对武侠小说的接受心理、美学风格、叙事主题、人物塑造等问题做了深入细致的研究,富于创见。当然,该书也存在着一些不足,如武侠小说与其他文体作品的关系、古典武侠小说与新武侠小说的继承等问题上还需进一步探讨。     

The Fault Line between Keynes and the Cambridge Keynesians: A Review Essay

This essay reviews Michael Ambrosi's important but neglected book on the formative period of Keynesian economics. The book traces the evolution of a Cambridge macroeconomic tradition running from Marshall and Pigou to Keynes, and interprets The General Theory as a response to Pigou's analysis of unemployment. Ambrosi also argues that Keynes's disciples, Richard Kahn, Nicholas Kaldor and Joan Robinson, were, in the 1930s, wedded to a Pigovian methodology and did not immediately recognise that Keynes had redefined the meaning of equilibrium in The General Theory. Keynes's attempt to redefine the analytical basis of neoclassical economics was thwarted, not merely by the neoclassical synthesis, but by those who claimed to be the inheritors and guardians of his vision.     

论新古典经济学诞生的标志

在新古典经济学的诞生之前,"效用"传统和"边际"传统一直是潜藏着的经济学发展的两条线索。马歇尔的最大贡献,就是他在《经济学原理》中创造出了"供需均衡分析"。这种分析能够包括上述的两条线索,它也以此成为了新古典经济学诞生的标志。     

The temporary equilibrium method: Hicks against Hicks

Abstract

Hicks is renowned for having introduced the temporary equilibrium framework in his book Value and Capital. Subsequently, however, he partially recanted this framework by rejecting the market clearing idea while still keeping the week device. The aim of this paper is to assess whether this change was right. My answer will be broadly negative. To make my point, I will ponder on the meaning and implications of the week device, assess the validity of Hicks' claim that slow adjustment can cause market rationing, examine his claim that the possibility of market clearing depends on the prevailing market form and, finally, assess his twofold filiations towards Marshall and Walras.     

P.W.S. Andrews' Manufacturing Business Revisited

P.W.S. Andrews (1914–1971) was a remarkable industrial economist at Oxford University, prominently as a member of the Oxford Economists’ Research Group (OERG) and Nuffield College. In the final few years of his life, he held a professorship at Lancaster University. As a self-described ‘practical theorist’, Andrews thought economists, particularly in the 1930s, inappropriately extended Marshall in a more formal, technical manner whereby the detailed reality of industrial economics was overshadowed. Such a ‘methodological mistake’ of a priori reasoning trumping the inductive method was countered by the OERG’s emphasis on grounded empiricism featuring extensive primary research on real businesses. A product of this research was Andrews’ Manufacturing Business that proffers a novel theory of the business firm. This article revisits Andrews’ signature book, paying particular attention to its apparent curiously harsh reviews by Austin Robinson and Arnold Plant, two distinguished Marshallian industrial economists. Moreover, Manufacturing Business is considered as a possible precursor of business strategy, a nascent discipline in the 1960s.     

Henry George: rebel with a cause

Henry George's Progress and Poverty (1879) was undoubtedly the most widely read book on economics in the nineteenth century. Its proposal for a ‘single tax’ on land rents inspired both socialists and liberal reformers in the closing decades of the nineteenth century but it was attacked and condemned by virtually all the leading economists of the day, principally on the ground that it was not possible even in principle to separate pure ground rent from profits on capital invested in land. The question whether land is a special factor of production, essentially different from labour and capital, turns out to be at the very heart of all the controversies surrounding the doctrines of Georgism; my view, like that of Marshall, is that land is indeed a unique factor of production.     

Alfred Marshall's critical analysis of scientific management∗

Abstract

In Industry and Trade, ‘A study of industrial technique and business organization; and of their influences on the conditions of various classes and nations’ (1919), Alfred Marshall develops a detailed analysis of scientific management, emphasizing not only its unquestionable advantages but also its dangerous limits. Although in the literature Marshall's evaluation of scientific management has been considered rather positive, the author has found it sceptical and definitively critical in many passages of his book. This paper deals with Marshall's analysis in order to underline the reasons why he criticizes Taylor's system, which, at that time, sounded like the greatest expression of modernity.     

制度分析的误区及其校正——制度分析的最新发展与《制度经济学三人谈》

这是一篇批评性和讨论性学术书评。文章概括了侃书和写书的优劣,说明了该书所取形式和所论内容的紧张,指出了该书与其说是一本制度经济学著作,不如说主要讨论的是制度哲学问题,批评了该书作者关于理论只是和只能解释理论,不是也不能解释实际的观点,在评介现代制度经济学最新发展的同时,揭示了该书作者在讨论过程理性和情景理性、均衡分析和秩序描述、哈耶克的法律观和规则观中的推进之处和不当之处,通过这些评论,旨在校正关于经济学制度分析可能出现的误区。     

Isolating the systematic and unsystematic components of a single stock’s (or portfolio’s) standard deviation: a comment

In an article that recently appeared in this journal, Marshall (2015) argued that the systematic component of the SD of a stock or of a portfolio of stocks is its beta scaled by the SD of the market returns. She also contended that the beta mispredicts the actual systematic risk of a stock or of a portfolio of stocks. In this article, I dispute this conclusion, showing that it has been induced by an imperfection in the construction of the empirical application and by some misinterpretations of the results. A corrected replication of the empirical study of Marshall (2015) is provided, along with some comments. I conclude that both the beta and the systematic component in Marshall (2015) are effective measures of systematic risk.     

Population relatedness and cross-country idea flows: evidence from book translations

This paper establishes a robust relationship between idea flows across countries, as captured by book translations, and two measures of population relatedness. I argue that linguistic distance imposes a cost on idea flows, whereas genetic distance captures an incentive to communicate when dissimilar countries have more to learn from each other. Consistent with this hypothesis, I find that linguistic distance is negatively associated with book translations, whereas genetic distance is positively associated with book translations after conditioning on linguistic and geographic distance. In particular, the benchmark estimate indicates that a one standard deviation increase in linguistic distance reduces book translations by 12%, while a one standard deviation increase in genetic distance increases book translations by 10%.     

International Trade Union Organizations

An attempt is made in this article to demonstrate that Alfred Marshall and John Maynard Keynes erected a number of signposts that point in the direction of a normative, institutional and policy-oriented social economics of labor. They opined that dysfunctioning institutions had thrown most members of the working class into an abyss of poverty. According to Marshall, poverty was caused by institutional neglect of education for the masses. Hence he recommended a drastic overhaul of those institutions that impinged on education. Keynes argued that the rentiers were the villains because they had intentionally reduced their funding of entrepreneurial investments. Consequently, investments dwindled and unemployment caused working-class poverty to rise above its customary levels. Keynes's solution was public investment in private enterprises, which he called socialization of investment. This would cause euthanasia of the anti-social rentiers. Because of their recommendations, Marshall and Keynes called themselves socialists.     

Alfred Marshall and François Perroux: the neglected liaison*

The richness François Perroux's economic theories have allowed the literature to highlight several connections between him and other authors. Among the names mentioned in the literature, one economist is conspicuous by his absence: Alfred Marshall. However, the relations between Marshall and Perroux are manifold and are far from accidental: not only because Perroux was a careful reader of Marshall but also and moreover because they both have an important common ground, which affected their perspectives. The main aim of this paper is to inquire into the aspects that characterise Marshall's and Perroux's approaches, stressing their affinities and underlining their common roots.     

Missing links in Marshall's early thoughts on education

Over the period 1867?-?73 Marshall integrated his thoughts on education reform with his work on psychology, and then economics. Around 1872, when the static method proved problematic with regard to long-term wage differentials, Marshall took his developing position concerning education and incorporated it into his emerging vision of political economy, the result being the germ of much of Book IV of the Principles. In addition, looking at Marshall's early study of psychology in conjunction with his writings on education provides further reason to doubt that Marshall ever embraced a wholly materialist philosophy.     

分工思想何以被忽视 ——以马歇尔为中心的思想史考察

分工思想是古典经济学的重要组成部分，但在马歇尔之后的新古典经济学中却一度被忽视。其缘由何在？本文以马歇尔为中心，做了思想史的考察。发现马歇尔的分工思想内含于对组织的分析中，这一分析采用了生物类比的方法。该方法与经济力学方法的兼容性是有争议的，这引发了20世纪20-30年代有关“报酬递增与代表性企业”的争论，使主流经济学走向了“去经济生物学，近经济力学”这一背离马歇尔思想的道路，这是分工思想被忽视的重要原因。     

Menger’s causal-realist analysis in modern economics

Carl Menger pioneered a unique theoretical research method which served as the foundation of the early Austrian school of economics. Menger’s causal-realist analysis was revived and formalized just before and after World War 2 by Ludwig von Mises as the “praxeological method.” Murray Rothbard, a student of von Mises’, utilized the method in formulating a comprehensive system of economic theory in his treatise, Man Economy, and State published in the early 1960s. Rothbard’s treatise became the foundational work for the “Austrian revival” in the 1970s. In this paper, we address several issues related to the role of Menger’s method in modern economics. First, ample evidence is adduced that von Mises and Rothbard each expressed a surprising ambivalence with respect to his own work in relation to the early Austrian school. Second, von Mises viewed Rothbard’s treatise as beginning a new epoch in economic theory. Third, contrary to the conventional view, a careful analysis of his treatise shows that Rothbard drew heavily on the contemporary neoclassical literature in developing his theoretical system and that his intent was never to set up a heterodox movement to challenge mainstream economics. Rather, his main aim was to consistently apply the praxeological method to rescue economics from what he considered the alien methodology of positivism, which was imported into economics after World War 2. Lastly, I will tentatively suggest that the term “Austrian economics” as the designation for the intellectual movement that coalesced in the early 1970s may now have outlived its usefulness. This term, which initially served an important strategic purpose in promoting the revival of the broad Mengerian tradition, may have come to obscure the meaning and importance of the praxeological research paradigm that Menger originated.     

The Law of Diminishing Marginal Utility in Alfred Marshall's Principles of Economics *

The goal of this paper is to clarify the content of the Marshallian Law of Diminishing Marginal Utility. The paper is divided into seven sections. In the first one, I present the eight formulations of the Law that I record in the Principles and the foundation that Marshall provides for it. In the second and third sections, I present a couple of objections raised by Marshall himself against the universal validity of the Law; in my opinion, his answer to them is not sound. I contrast my interpretation with those of the other authors. In the fourth section, The Law of Utility is distinguised from the Law of Demand. In section five, l present the two meanings in which Marshall employs the term ‘utility’: as pleasure, and as a formal notion. In section six, I attempt to build an explanatory framework for the encountered difficulties. Finally, the seventh section is devoted to conclusions.     

REVIEWS

Book reviewed in this article:
A Study of Cost and Demand Inflation. By J. D. P itchford . Contributions to Economic Analysis XXXIII.
From Marshall to Keynes. An Essay on the Monetary Theory of the Cambridge School. By B. E shag .
Real Wages in Soviet Russia Since 1928. By J anet E. C hapman . The Age of Marshall. Aspects of British Economic Thought 1890–1915. By N. J ha .     

论跨国公司的社会责任——读霍肯的《商业生态学:可持续发展的宣言》有感

本文简要介绍和评述了霍肯的著作《商业生态学:可持续发展的宣言》的基本思想和主要观点,强调了解决商业与环境之间二元悖论问题的关键,在于设计、创造一个可持续发展的商业模式,使之能融入生态系统的可恢复体系中,并强调在这个过程中,企业"对社会负责"是一种自愿的行为。从霍肯的观点出发,笔者反思了跨国公司违背生态伦理的种种"罪行",提出必须以更为冷静、客观的态度来看待跨国公司,并提出了"拯救跨国公司=拯救人类自己"的主张。     

Is the economics of time and ignorance a “classic”?

A history of economic thought perspective on The Economics of Time and Ignorance reveals that the book rehabilitates some major themes in the Austrian tradition that were all but lost subsequent to the formalist revolution in economics that took place in the middle of the twentieth-century. The book also anticipates some important ideas that were extended and applied in Austrian economics after it was first published. Reviews have claimed that the book was a “classic” and also “original”. The book is too close in a temporal sense to judge whether or not future generations will canonize it as a “classic”. Using Stigler’s criteria as to what constitutes scientific “originality”, it is concluded that, taken as a whole, the book was not original. From the vantage point of the overall discipline of economics, it was a work advancing controversial ideas that would not easily change the beliefs, practices and interests of economists in general but it offered sound reasons for taking the Austrian thought-trajectory more seriously. It would be more fitting to view the authors as providers of many innovations contributing to the mature Austrian economics of the twenty-first century.